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Say Hello to America’s Least-Taxed Corporation: Charter/Spectrum’s 2017 U.S. Tax Rate Was -883.95%

Phillip Dampier November 8, 2018 Charter Spectrum, Public Policy & Gov't 1 Comment

(Source: Wallethub)

When Charter Communications CEO Thomas Rutledge met with President Donald Trump in early 2017, he probably did not realize just how much the Trump Administration was prepared to reward America’s second largest cable company.

After collecting a $98 million dollar compensation package for himself by successfully pulling off acquisitions of Time Warner Cable and Bright House Networks, Rutledge today presides over America’s least taxed corporation. In fact, the American people owe Charter a significant ‘refund’ after the company achieved a negative overall U.S. tax rate of -883.95%.

WalletHub analyzed annual reports for the S&P 100 — the largest and most established companies on the stock market — in order to determine the federal, state and international tax rates they paid in 2017.

Charter’s tax accountants took full advantage of the Trump Administration’s permanent corporate tax cuts, which lowered corporate tax rates from 35% to 21%. But Republicans who supported the corporate tax cuts left intact most of the generous corporate deductions, offsets, and other credits that ensured few of America’s top corporations ever paid anything close to 35%. As a result, the lowered tax rate combined with what critics call “corporate welfare and giveaways” allow a growing number of companies to not pay a penny in taxes. In fact, many will be in the enviable position of avoiding taxes and still getting an effective ‘refund’ worth billions.

Companies that are required to regularly invest in their businesses and buy equipment, hardware, and other tangibles as part of the cost of doing business are often the most generously rewarded. Tax deductions originally intended to inspire corporate spending during tougher economic times are great news for companies that have significant capital investments. Most of these companies planned on making those investments with or without a tax break, but all are welcome to the idea of using those investments to reduce their effective tax rate to zero. Charter’s acquisitions of Time Warner Cable and Bright House came with the understanding both systems needed substantial upgrades — spending Charter is using to offset taxes not just this year, but several years in the future.

The next least-taxed company was Kraft Heinz, which was taxed at -98.7%. Other big winners are AT&T (-98.36%), Comcast (-55.59%), and Verizon (-51.36%). AT&T and Verizon are frequent winners of an effective tax rate of 0.00% because of the substantial deductions available to both as a result of continually upgrading their highly profitable cellular networks.

Source: WalletHub
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9 months ago

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  • txpatriot: Thanx for the links -- I haven't had time to review all of them but I did look at the "Corporate Tax Dodgers Report". It confirmed one of my assumpti...
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  • Bette: All you Verizon workers should really be paying attention to what's being said here. I retired from NYNEX after 36 years - then they became Bell At...
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  • Michael Elling (@Infostack): Scott, great points. Forgot about all those ridiculous local taxes and USF fees. There is so much regulatory bloat, so that's why Google let's the u...
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  • Jay S: From an accounting perspective, one generally would not call the use of an 'asset depreciation schedule' an example of corporate welfare. I don't se...
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  • txpatriot: And by the way, a refund doesn't necessarily mean taxpayers are subsidizing AT&T. All it means is that AT&T paid more in taxes than it was le...

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